tag:blogger.com,1999:blog-36227136.post4291176022600771788..comments2024-01-16T08:40:53.682+00:00Comments on <a href="http://www.openeurope.org.uk">Open Europe</a>: Merkel and Letta shadowbox on 'growth' vs 'austerity' OEhttp://www.blogger.com/profile/00556463374230498875noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-36227136.post-17584843439459680552013-05-03T11:27:50.263+01:002013-05-03T11:27:50.263+01:00Os Italianos estão revoltados com a crise europeia...Os Italianos estão revoltados com a crise europeia e agora com o novo governo ainda mais se revoltam Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-40354299947043389102013-05-02T08:30:27.743+01:002013-05-02T08:30:27.743+01:00Italy with France are structurally the biggest lon...Italy with France are structurally the biggest long term risks for the EZ even if the set up was considerably changed. Spain is considerably smaller.<br />A combination of size of their economy; debt levels; and being able to get away with murder (ignore the rules). Next to being unable politically to change a failed business model.<br /><br />Italy is simply moving to 130+% debt levels. It is simply too high longer term even if they would get the economy running again (which is highly doubtful as they didnot manage to do that pre-crisis when conditions were much better).<br />France is 90% and looks with the policies at place simply for the foreseeable future to rise further. Even in favourable (relatively) conditions, no E-rescue hitting the budget and/or no banks having to be rescued.<br /><br />As said earlier it is about structural reforms not about austerity. If getting competitive without reducing the costbase would work it is fine as well. However hardly any structural reforms and continue an overborrowing, low growth (at best) business model is not. And the latter is what they are doing.<br /><br />Countries like Italy simply have an unsustainable unaffordable style of living. They should get it properly financed (tax the rich and the middleclasses) or should abolish entitlements till it is sustainable. Simply no other alternative.<br /><br />And they will have to realise if the want to be close to the top income countries, they probably need a German model of governance. The local one is not simply fit for purpose anymore, too ineffective and too expensive (bad value for money). Which will be a difficult culture change. Choice looks clear: Get German or Get Poor. Riknoreply@blogger.com